What is Stamp Duty?

What Is Stamp Duty?

Stamp duty land tax or SDLT is a taxed sum that must be paid when buying a property or land if it costs more than a certain amount. The rate at which you’ll pay the tax varies based on the property price and some additional factors.

At Gorvins, we know that purchasing a property can be a stressful time and, whether it’s your first home or you’re a seasoned investor, there can be unexpected hurdles during the buying process.

The most common issues encountered by prospective buyers are of a financial nature, so understanding the potential costs and implications will help to ensure everything runs as smoothly as possible from offer through to completion.

How Much Is Stamp Duty (SDLT)?

This varies depending on a number of factors, including:

• The value of the property
• Whether you are a first time buyer
• If you’ve bought a home before
• If you are purchasing a second/additional property
• If the property is leasehold or freehold
• You are purchasing a shared ownership property

This is not an exhaustive list and you should check with your solicitor before proceeding with your calculations.

Stamp Duty Changes For First Time Buyers

Under the current budget first-time buyers pay zero stamp duty on the first £300,000 of any property up to the value of £500,000. This means for any home worth less than £300,000, you’ll pay no stamp duty.

For purchase prices between £300,001 and £500,000, you will pay 5% on that portion of the purchase price only. For those first-time buyers purchasing a home costing more than £500,000, you won’t benefit from any change and will be buying under the standard system and you will follow the rules of people who have bought a home before.

Stamp Duty Calculator

In order to calculate SDLT for your property purchase the Gov.UK website offers a simple calculation tool to help you work out these costs.

The SDLT return form must be sent to the HMRC within 14 days of completion and your Gorvins case manager will organise this on your behalf as part of the house buying process.